Interest expense
Encyclopedia
Interest expense relates to the cost
of borrowing money. It is the price that a lender charges a borrower for the use of the lender's money. Interest
expense
is different from OPEX
and CAPEX
, for it relates to the capital structure
of a company. Interest expense is usually tax-deductible.
Cost
In production, research, retail, and accounting, a cost is the value of money that has been used up to produce something, and hence is not available for use anymore. In business, the cost may be one of acquisition, in which case the amount of money expended to acquire it is counted as cost. In this...
of borrowing money. It is the price that a lender charges a borrower for the use of the lender's money. Interest
Interest
Interest is a fee paid by a borrower of assets to the owner as a form of compensation for the use of the assets. It is most commonly the price paid for the use of borrowed money, or money earned by deposited funds....
expense
Expense
In common usage, an expense or expenditure is an outflow of money to another person or group to pay for an item or service, or for a category of costs. For a tenant, rent is an expense. For students or parents, tuition is an expense. Buying food, clothing, furniture or an automobile is often...
is different from OPEX
Operating expense
An operating expense, operating expenditure, operational expense, operational expenditure or OPEX is an ongoing cost for running a product, business, or system . Its counterpart, a capital expenditure , is the cost of developing or providing non-consumable parts for the product or system...
and CAPEX
CAPEX
CAPEX, also known as the Kerala State Cashew Workers Apex Industrial Co-operative Society, is an organization managed by the government of Kerala to promote the cashew industry and especially the export market for cashews.-Organization:...
, for it relates to the capital structure
Capital structure
In finance, capital structure refers to the way a corporation finances its assets through some combination of equity, debt, or hybrid securities. A firm's capital structure is then the composition or 'structure' of its liabilities. For example, a firm that sells $20 billion in equity and $80...
of a company. Interest expense is usually tax-deductible.